C O A L I T I O N Corner Seller Disclosure Coalition Corner: Business training tools for HR staff, real estate licensees and other service professionals in the relocation and real estate industries © 2005, Employee Relocation Council/Worldwide ERC ® Coalition

C O A L I T I O N Corner Program Objectives This program supplements a monthly editorial feature in ERC’s Mobility magazine In this segment, users will learn: –How to define seller property disclosure –Who is responsible for property disclosure in relocation transactions –How and when to disclose –Why it is important to disclose property information correctly

C O A L I T I O N Corner Background on Seller Disclosure Legal trends have shifted from a “caveat emptor” (“let the buyer beware”) approach to sellers assuming an increasing amount of responsibility to disclose relevant information to prospective buyers The law of disclosure is simply that of required truth in selling Forms for gathering and reporting the necessary information may be mandated by law, used as a voluntary practice and/or developed by professional associations

C O A L I T I O N Corner Seller Disclosure Defined A means for an existing property owner to reveal those structural and environmental aspects of a property that might have an impact on the property’s value

C O A L I T I O N Corner Types of Items to Disclose In addition to details about the more obvious structural components of a property (roof, siding, foundation, etc.), scientific advances have added an increasing number of environmental elements to the list of items to disclose -- the presence of which at certain levels might have an impact on the health and safety of occupants. Some examples include: –Radon –Asbestos –Lead Paint –Mold

C O A L I T I O N Corner Who’s Responsible? Disclosure in the context of relocation can become slightly more complicated, as sellers are often corporate employers or relocation management companies (RMCs) who may or may not be familiar with the property Real estate licensees can often provide the necessary form(s) to the seller, but should never complete or assist in the completion of the forms It is essential that the initial disclosure information is supplied by the transferring employee and is shared with the employer and /or relocation management company and all prospective buyers

C O A L I T I O N Corner How/When is it Done? Many states have mandated property disclosure forms/laws to follow ERC’s Public Policy Committee has developed the “ERC Homeowner Disclosure Statement” to assist in the process, and/or supplement state forms (available to ERC members at ) Regardless of type of homesale program used, employees/affinity group members should provide a copy of the disclosure statement(s) and/or form(s) at the beginning of the process, and preferably before an appraisal is conducted

C O A L I T I O N Corner Why is it Important? Corporate employers, RMCs and/or affinity program members are viewed as professionals, and are often held to higher standards/greater obligations to buyers Proper, true and complete disclosure helps avoid potential embarrassing and costly liability issues/lawsuits When in doubt, err on the side of more disclosure rather than less